Police Cannot Seize Bank Accounts Under Section 102 CrPC Without Direct Link To Offence: Bombay High Court

The Bombay High Court has held that police cannot freeze or seize bank accounts under Section 102 of the Code of Criminal Procedure, 1973, without establishing a direct nexus between the seized property and the alleged offence. The Court observed that imposing an onerous condition of furnishing a bank guarantee equivalent to the frozen amount while directing de-freezing of accounts frustrates the very object of such de-freezing.Justice N.J. Jamadar was hearing two criminal applications arising from an order passed by the Additional Chief Metropolitan Magistrate directing the de-freezing of bank accounts and mutual fund units of the accused, subject to furnishing a bank guarantee of Rs. 6.55 crores. One application was filed by the first informant challenging the very de-freezing of the accounts, while the other was filed by accused no.2 challenging the condition requiring the furnishing of the bank guarantee. The accused contended that there was no nexus whatsoever between the frozen accounts and the alleged offences. It was argued that Section 102 empowers seizure only of property having a direct connection with the offence under investigation and not any property belonging to an accused. The Court examined the scope of Section 102 CrPC and observed that though bank accounts constitute “property” under Section 102, the power to seize can be exercised only where there exists a direct link between the property and the commission of the alleged offence.The Court observed that the emphasis is on the character of the property rather than its association with persons involved in the offence. It held that only property alleged or suspected to be stolen, or property found in circumstances creating suspicion of the commission of an offence, can be seized. The Court further observed that Section 102 is intended to assist in the investigation and collection of evidence and is not a mechanism to secure recovery for the complainant or to hand over property to a person whom the investigating agency believes to be the rightful owner.“… though the text of Section 102(1) uses the expression “any property” which the Police Officer can/may seize, yet the power to seize the property stems from the expressions which follow, namely, “the allegation or suspicion that such property is stolen” or “it is found in a circumstances which creates suspicion of commission of any offence”. There ought to be a direct link between the property which is seized and the offence which is alleged to have been committed,” the Court observed. The Court noted that the material on record did not prima facie establish the necessary nexus between the frozen bank accounts and mutual funds and the commission of the alleged offences. On the condition imposed by the Magistrate, the Court held that requiring the furnishing of a bank guarantee of Rs. 6.55 crores virtually amounted to a refusal of the prayer for de-freezing itself. The Court observed that such an onerous condition frustrated the very purpose of de-freezing the accounts. Holding that reasonable conditions alone could be imposed, the Court modified the order by directing the de-freezing of the accounts, subject to furnishing an indemnity bond instead of a bank guarantee.Accordingly, the Court dismissed the application filed by the first informant and partly allowed the application filed by accused no.2 by modifying the condition imposed for the de-freezing of the accounts.Case Title: Geeta Kampani v. State of Maharashtra with Parag Shah v. Geeta Kampani [Criminal Application No.790 of 2024 with Criminal Application No.191 of 2024]Citation: 2026 LiveLaw (Bom) 257Click Here To Read/Download Order

Police Cannot Seize Bank Accounts Under Section 102 CrPC Without Direct Link To Offence: Bombay High Court

Saksham Vaishya

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Police Cannot Seize Bank Accounts Under Section 102 CrPC Without Direct Link To Offence: Bombay High Court

Saksham Vaishya

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